Tuesday, January 03, 2006

Starz introduces Vongo, a new downloadable movie service

When Starz executive Bob Greene was in San Francisco last month, he was nice enough to offer me a demo of the company’s new-and-improved movie download service, Vongo. Today, the company unveiled the beta version of Vongo.

I of course told him the name made me think of Mongo, the muscle-bound buffoon played by Alex Karras in “Blazing Saddles.” Greene didn’t seem to think the cinematic association was an entirely bad thing – though of course that wasn’t their intention. Starz had earlier launched a movie download service called Starz Ticket, which will continue to exist – but Vongo, Greene says, is the company’s main focus now.

Vongo is clearly intended to rival the still-nascent video department in Apple’s iTunes media superstore. In a few months, Vongo will help answer a few very important questions:

How much of an appetite is there for movies downloaded legally from the Net for viewing on a laptop, television set, or handheld video player? (Apple doesn’t yet offer full-length features – only TV shows, music videos, and short films)

What price will consumers pay? Vongo will sell movies on a pay-per-view basis for $3.99 a pop; an unlimited monthly subscription costs $9.99.

Will it matter that Vongo’s movies can’t be viewed on an iPod (but can be seen on Portable Media Centers and other handheld devices)?

So first, some notes from my conversation with Greene, who is SVP of Advanced Services at Starz – and then, my predicted answers to those questions.

- Vongo isn’t selling any movies that you can own (what people in the industry call “download-to-own,” or "electronic sell-through"). You can watch the Starz channel live, or download movies – but the files all expire from your hard drive after specified viewing periods. (Pay-per-view downloads vanish after 24-hours, for instance.)

- Monthly subscribers will have access to a rotating inventory for 800-1000 movies. (A movie may be available in January, for example, but disappear in February.) Greene says there will eventually be about 250 different movies available for pay-per-view purchase.

- Vongo's interface design is pretty sweet… here, Vongo really gives Apple a run for its money. But like iTunes, the service isn't Web-based: it's a client-side application that must be downloaded.

- Greene believes that consumers will want to view some content that’s downloaded from Vongo on their TVs. But he’s not a fan of the technologies (like Microsoft's Media Center Extender) that are out there today to link PCs with TVs. “Within a 12-month window,” Greene predicts, “I believe that there will be very elegant, simply plug-and-play media extenders that don’t require configuration, that’ll just read that you have these devices, over your wireless network in your house, or maybe over your powerlines.” Another option is to put the video onto a portable device, carry it over to the TV, and plug it in.

- “I think Apple will [eventually sell full-length movies],” Greene told me. “We’re not selling the movies. We’re giving you the ability to subscribe, or get it for 24-hours.” Greene points out that putting a collection of movies that have been `downloaded-to-own' will quickly fill up a laptop or iPod. “The value of a subscription model,” he says, “is that you can cycle through movies.”

- Mac users (like me) won’t be using Vongo; its based on the Windows Media 9 format. (Here's a piece from Macworld that indicates that Apple isn't all that eager to work with Vongo.)

- Greene is interested in offering full-length concerts; he sees that as an opportunity for Vongo to offer something that other services don’t.

Expect an announcement soon from Movielink about changes and enhancements to their movie download service.

Finally, my predictions. I think there’s a giant appetite for movies downloaded legally – and think consumers will probably be more comfortable paying $3.99 a la carte, rather than adding yet another monthly subscription to their credit card bill.

And I think 2006 is the year that devices other than the video iPod will start to gain traction – devices with bigger screens, that can connect to marketplaces like Vongo that offer full-length features at a reasonable price. This will force Apple to stop resting on its laurels, figure out how to offer movies, and probably unveil an iPod with a larger screen that’s better suited to video-viewing. Someone, whether Apple, Vongo, Brightcove, or Google, needs to make it easy for independent content producers to upload their content and charge for it. There's more money in that than most people suspect.

Conversely, 9.99/month is a perfectly fair price for unlimited access to the movie library. And consider that there is also less lag time than snail-mail-based services like Netflix. We are, after all, the Instant Gratification Nation...

Quality...is Vongo inferior to DVD quality? Technically, yes. Perceptibly? Not necessarily. The movie files are 600-700MB average size, which is big enough to hold a good quality MPEG-4 encoding. WMV9 compares favorably to DivX and other MPEG-4-type encoders (yes, I know WMV9 isn't EXACTLY MPEG-4, but it's a similiar codec). And I can attest that a good DivX encode can come pretty close to the percieved image quality of a DVD.

The iTunes store was built on the concept that people are willing to trade a little quality for a lot of convenience. It appears that Vongo is doing the same thing, only with movies.

I wonder how long before we see a jhymn-type drm removal utility for Vongo movie files?

This "expiration date" crap will kill them. Plus, it will easily be cracked and create an undergdound of hackers who rape their system. Ask Sony how much people like having their content "controlled".

These should be high-quality downloads, in the 1 gigabyte range for now, that people can move easily between their PCs, iPods, TVs, etc. People will just have to be trusted that they will not "share" them online... which is easy enough to do anyway by simply ripping DVDs of the same titles. It only takes one person to rip a DVD and upload it to bit torrents, then the cat is out of the bag. So why burden people who actually want to do the right thing by paying for their downloaderd movies by placing these "expirations" and other DRM crap onto the Vongo downloads.

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CinemaTech focuses on how new technologies are changing cinema - the way movies get made, discovered, marketed, distributed, shown, and seen. (With occasional forays into other parts of the entertainment economy.) You can also follow CinemaTech on Twitter (@ctechblog).

About Me

For about the last ten years, I've been writing about innovation for publications like the Boston Globe, the New York Times, Wired, Variety, Fast Company, the Hollywood Reporter, Salon.com, BusinessWeek, and Newsweek.
I helped start (and continue to help run) three conferences: Future Forward, the Nantucket Conference on Entrepreneurship & Innovation, and Convergence: The Life Sciences Leaders Forum. I also often speak and moderate at other people's conferences, and serve as a commentator on TV and radio. (Which beats actual work.)
You can reach me by e-mailing kirsner - at- pobox.com. My personal site is www.scottkirsner.com.